NOTE 10 — Earnings per Common Share

The two-class method is used in the calculation of basic and diluted earnings per share. Under the two-class method, earnings available to common shareholders for the period are allocated between common shareholders and participating securities according to participation rights in undistributed earnings. The factors used in earnings per share computation follow:



	For the Years Ended December 31,
	2019		2018		2017
Basic
Net income	$	14,143	$	8,734	$	3,644
Less: Earnings allocated to preferred stock		—		—		23
Net income allocated to common shareholders	$	14,143	$	8,734	$	3,621
Weighted average common shares outstanding		7,388,702		7,374,013		6,163,549
Basic earnings per share	$	1.91	$	1.18	$	0.59

Diluted
Net income	$	14,143	$	8,734	$	3,621
Weighted average shares outstanding for basic earnings per share		7,388,702		7,374,013		6,163,549
Add: Dilutive effects of share based awards		396,034		359,359		68,695
Average shares and dilutive potential common shares		7,784,736		7,733,372		6,232,244
Diluted earnings per share	$	1.82	$	1.13	$	0.58

Stock based awards totaling 164,250 and 129,500 shares of common stock were not considered in computing diluted earnings per common share for 2019 and 2018, respectively, because they were anti-dilutive. There were no antidilutive shares in 2017.